Discriminating Customers through Practices of CRM with the Application of Discriminant Function Analysis

Abstract

Customer Relationship Management (CRM) is a broad concept for retaining, creating and expanding customer relationships in banking sector. The overall strategy of relationship marketing is to effectively manage the customers of the organization. CRM enables to anticipate, understand, manages, and personalizes the requirements of customer. Today, many business organizations such as insurance companies, banks and other service providers realize its importance. They also understand the potential of CRM which help them to attract new customers and retain existing ones which maximize their lifetime value. The current marketing scenario the CRM viewed as the process of acquiring customers with understanding their needs, wants and demands. The specific strategy of CRM approaches is find the current expectation and requirements of new customers in segmented market. It is also a process which invites total commitment on the part of the entire organization regarding relationship strategies. So the researcher has taken to the study discriminating customers through practices of CRM with the application of discriminant function analysis. For the empirical investigation the data collected from 384 respondents through self administrated questionnaire. In order to cluster the respondents on the basis of CRM practices discriminant function analysis employed. The result of DFA (Discriminant Function Analysis) customer knowledge dimension is the best predictor for evaluating the CRM practices in banks.

Keywords: Customer Relationship Management, Banks, Discriminant Function Analysis, Relationship Marketing, Customer Satisfaction, CRM Practices

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